Postal Service reform passes House
Postal Service reform passes House
The House of Representatives approved HR 3076, the bipartisan Postal Service Reform Act, by a vote of 342-92 on Tuesday. The bill would repeal the US Postal Service’s notorious “pre-funding” requirement for retiree health benefits, and shift health costs for most USPS retirees to Medicare. It would allow the USPS to offer non-postal services on behalf of state and local governments, codify six-day delivery, and require the USPS to publish data on delivery performance. House Oversight Committee Chair Carolyn Maloney (D-NY) and ranking member Rep. James Comey (R-KY), who cosponsored the bill, said that the legislation would ensure the continued survival of the USPS as an independent organization.
House approves federal government funding through March 11
With a deal close on an appropriations deal for FY 2022, the House voted 272-162 to pass a stopgap funding bill that will keep the government running through March 11. The current continuing resolution will expire on February 18; the Senate will take up the extension next week.
House, Senate hearings call for federal framework for digital assets
Under Secretary of the Treasury Nellie Liang spent more than four hours with the House Financial Services Committee this week, discussing the recommendations of the President’s Working Group on Financial Markets for a federal regulatory structure for stablecoins. The report recommends that only federally insured depository institutions (IDIs) be allowed to issue stablecoins, although Liang emphasized that these IDIs would be regulated according to their activities, and not necessarily subject to the full spectrum of bank supervision. Neither Democrats nor Republicans seemed enthusiastic about this proposal. On the Senate side, Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam testified before the Committee on Agriculture on Wednesday about the wider range of digital assets, emphasizing the need to close gaps in federal regulatory oversight and clarify the roles of the CFTC and the Securities and Exchange Commission (SEC). Under Secretary Liang will testify before the Senate Banking Committee next week.
Bipartisan work continues on water projects
The House Transportation & Infrastructure Subcommittee on Water Resources and the Environment held the second of three planned hearings this week on projects to be funded by a Water Resources and Development Act of 2022. Representatives of state, local, and tribal organizations presented proposals that included finishing construction of the Everglades Agricultural Area Reservoir, the Comprehensive Everglades Restoration Project, and major improvements to ports in Long Beach and Houston. The House has passed Water Resources and Development Acts every two years since 2014, and Chair Peter DeFazio (D-OR), Subcommittee Chair Grace Napolitano (D-CA), and Subcommittee ranking member Rep. David Rouzer (R-NC) pledged that this tradition would continue.
Are institutional investors raising the price of housing?
Senate Banking Committee Chair Sherrod Brown (D-OH) said at a hearing yesterday that too many institutional investors are driving up rents and single-family housing prices around the country, and hiding behind LLCs and real estate investment trusts that make it impossible for local authorities to enforce building codes or tenant protection laws. The Committee held a virtual listening session on Tuesday to hear from tenants who reported rent increases, substandard housing conditions, and lack of access to repairs and other services in rental properties owned by large corporations, institutional investors, and private equity owners. Senator Patrick Toomey (R-PA), the Committee’s ranking member, was the only Republican who attended yesterday’s hearing, said that rising housing costs were the result of inflation and a housing shortage exacerbated by Administration policies. Brown and Toomey did agree, however, that they are close to consensus on broad principles for housing reform legislation, and said they hoped to pursue that later this year.
CRA, climate change, bank mergers, crypto-assets to be FDIC priorities, says Gruenberg
Martin J. Gruenberg, Acting Chairman of the Federal Deposit Insurance Corporation (FDIC), issued a statement on Monday about the agency’s priorities for the rest of the year. At the top of the list is strengthening the rules implementing the Community Reinvestment Act (CRA), a major initiative the FDIC has been pursuing with the Federal Reserve Board and the Office of the Comptroller of the Currency. The FDIC will seek comment on guidance for banks making decisions about how to manage climate-related risks, and Gruenberg said that the FDIC will join the international Network of Central Banks and Supervisors for Greening the Financial System. The agency will review its process for considering bank merger applications, which “has not been comprehensively reviewed in 25 years,” and will carefully consider the risks posed by crypto-assets to safety and soundness and the financial system. The FDIC and other federal banking agencies will also be implementing the Basel III international capital framework.
Confirmations, Nominations, Departures
The Federal Deposit Insurance Corporation (FDIC) has named Kymberly Copa as Deputy to Acting Chairman Martin Gruenberg and Chief of Staff; Daniel Bendler as Deputy to the Acting Chairman and Chief Operating Officer; and Harrel Pettway as General Counsel.
The Week Ahead
The House of Representatives will be working remotely next week, with all hearings virtual and no floor votes scheduled. The Senate is expected to vote next week on the Postal Service Reform Act, as well as on the continuing resolution to fund the government through March 11.
February 15 at 10 a.m. Senate Committee on Banking, Housing, and Urban Affairs holds a hearing on “Examining the President’s Working Group on Financial Markets Report on Stablecoins.”
February 15 at 11 a.m. House Small Business Subcommittee on Underserved, Agricultural, and Rural Business Development holds a hearing on “The Infrastructure Investment and Jobs Act’s Benefits for Small Businesses.”
February 15 at 11 a.m. House Energy & Commerce Subcommittee on Environment and Climate Change holds a hearing on “Back From the Brink: Restoring Brownfield Sites to Economic Engines.”
February 16 at 12 p.m. House Committee on Financial Services holds a hearing on “An Unprecedented Investment for Historic Results: How Federal Support for MDIs and CDFIs Have Launched a New Era for Disadvantaged Communities.”
February 16 at 2 p.m. House Committee on House Administration holds a hearing on “Big Data: Privacy Risks and Needed Reforms in the Public and Private Sectors.”
February 17 at 10 a.m. Senate Banking Committee holds a hearing on “The State of the American Economy: A Year of Unprecedented Economic Growth and Future Plans,” with testimony from members of the Council of Economic Advisers.
February 17 at 10 a.m. Senate Committee on Finance holds a hearing on “Spotlighting IRS Customer Service Challenges.”
February 17 at 12 p.m. House Financial Services Subcommittee on National Security, International Development and Monetary Policy holds a hearing on “The Role of the International Monetary Fund in a Changing Global Landscape.”
February 17 at 3 p.m. House Financial Services Subcommittee on Consumer Protection and Financial Institutions holds a hearing on “Small Businesses, Big Impact: Ensuring Small and Minority-Owned Businesses Share in the Economic Recovery.”
The Ellis Insight - Jim Ellis on political news
SENATE
Alaska: State Rep. Elvi Gray-Jackson (D-Anchorage) announced that she will enter the 2022 US Senate race, challenging incumbent Lisa Murkowski (R). Ms. Gray-Jackson becomes the first Democrat to become a Senate candidate.
The party nomination may be more valuable in this election than in any other because of changes to Alaska election law. The state’s new qualifying system will feature four jungle primary candidates advancing into the general election. With the chance of three Republicans qualifying for the general, a lone Democratic slot could be valuable as the GOP contenders would likely split the majority vote. Mostly because of the election system change, the Alaska Senate race becomes one to watch.
Maryland: Maryland Gov. Larry Hogan (R) this week announced that he will not challenge Sen. Chris Van Hollen (D) later this year. The decision is not a surprise, since Gov. Hogan has clearly been looking toward a national race in 2024 as opposed to running what could be an uphill battle for the Senate in Maryland. Though his favorability ratings are as strong as any Governor in the country, it appears to be more difficult in today’s political climate to change partisan vote trends for federal offices. Sen. Van Hollen remains a strong favorite for re-election.
Pennsylvania: Montgomery County Commissioner Val Arkoosh, the only woman in the Democratic US Senate field who was once thought of as a top tier contender, has ended her statewide bid. With Lt. Gov. John Fetterman and US Rep. Conor Lamb (D-Pittsburgh) leading the field with a substantial margin, Ms. Arkoosh did not see a viable victory path. State Sen. Sharif Street (D-Philadelphia) previously declined to run after being an early unofficial candidate. State Rep. Malcolm Kenyatta (D-Philadelphia), who has shown improved polling numbers, remains in the race. The Pennsylvania primary is May 17th.
HOUSE
IA-2: Democratic state Sen. Liz Mathis (D-Hiawatha/Cedar Rapids) released a Public Policy Polling survey (2/2-3; 623 IA-2 registered voters; live interview and text) and the results find her running predictably close in a ballot test with freshman Rep. Ashley Hinson (R-Marion). The PPP poll sees Rep. Hinson posting only a 43-42% edge.
We can expect close polling such as this in three of the state’s four districts to occur throughout the election cycle. Districts 1 (Rep. Mariannette Miller-Meeks-R), 2 (Rep. Hinson), and 3 (Rep. Cindy Axne-D) are all highly competitive and each of these Hawkeye State congressional campaigns are likely to land in the toss-up category well before the November 8th elections.
MI-11: According to the Jewish Insider publication, the Target Insyght survey research firm conducted a poll of the Democratic primary in Michigan’s new 11th District that features an incumbent pairing between Reps. Haley Stevens (D-Rochester Hills) and Andy Levin (D-Bloomfield Township). The TI numbers (2/1-3; 400 MI-11 likely Democratic primary voters) found the two members tied at 41% apiece. Last week, Ms. Stevens released her Impact Research internal poll posting her to a 42-35% advantage.
New York: Now that the New York congressional map is all but assured of becoming law, US House members and candidates are beginning to select districts. Rep. Claudia Tenney (R-New Hartford) announced that she will leave her current 22nd District to seek re-election in the more Republican and open 23rd District (Rep. Tom Reed-R; retiring), and Rep. Chris Jacobs (R-Orchard Park), who could run in the new 23rd or the new 24th, has chosen to declare his candidacy in the latter district.
With current 24th District incumbent John Katko (R-Syracuse) retiring, his seat has been converted into the new 22nd District and becomes Democratic (D+13 according to the FiveThirtyEight data organization).
SC-1: Though redistricting made South Carolina’s 1st District more Republican, freshman Rep. Nancy Mace (R-Charleston) now finds herself drawing a more legitimate Republican challenger. Katie Arrington, who defeated then-representative and former Governor Mark Sanford in the 2018 Republican primary but then went onto lose the general election, announced that she will make a political comeback here this year.
Ms. Arrington, who former President Trump endorses, lost her associated general election through campaign mis-steps and being an unfortunate victim of a serious car accident that kept her away from the campaign trail for an extended time. The Congresswoman, however, remains the favorite to win re-nomination.
REDISTRICTING
Alabama: On a 5-4 vote, the US Supreme Court voted to stay the lower court ruling that invalidated the new Alabama congressional map. The Republican three-judge panel had ruled that a second majority minority district could have been drawn among the state’s seven congressional districts. Arguing for the majority, Justice Brett Kavanaugh stated that the lower court decision was made too close to the 2022 election to allow a full judicial review. Analysts say this ensures that the original map will be back in place for this year’s election. The new plan is virtually an extension of the current map, which elected six Republicans and one Democrat in the 2020 election.
Connecticut: Responding to the special master they appointed to draw the new congressional map, the Connecticut state Supreme Court justices yesterday approved a new “least change” plan that will likely keep the state’s 5D-0R map intact. The plan merely adjusted the population so that each district met the state per district population quota of 721,189 individuals. The most out of balance district was Rep. Jim Himes’ (D-Cos Cob) 4th CD, being 25,627 people over-populated. The seat closest to the mark was Rep. John Larson’s (D-East Hartford) 1st District that needed to add just 3,535 residents.
Kansas: Democratic Gov. Laura Kelly vetoed, as expected, the Republican legislature’s new congressional map that makes the 3rd District of Rep. Sharice Davids (D-Roeland Park/Kansas City) more competitive. After obtaining the necessary 2/3 majority in the legislature to override Gov. Kelly’s veto means the new congressional map now becomes law. Democrats pledge to challenge the new map in court.
North Carolina: In what has almost been a decade-long game of gerrymander ping pong, the state Supreme Court rejected the new North Carolina congressional and state legislative maps, thus repeating their actions of two previous times the high court disqualified a Republican legislature’s map. The vote was 4-3, with all four Democrats voting in favor of declaring the map a political gerrymander, consistent with their past action, while the three Republicans voted to uphold the lower court ruling that validated the plans.
Whatever happens this year, there is a good chance we will see another re-draw before the 2024 election since Republicans have a strong chance of securing a majority on the high court in the coming elections. Two of the Democratic justices are on the ballot, one is retiring, and no Republican has to risk his seat. The NC primary is June 7th.
Ohio: Seeing the state Supreme Court reject for the second time the legislature’s state House and Senate redistricting plans, House Speaker Bob Cupp (R-Lima) announced that he is referring the congressional map to the Ohio Redistricting Commission. The panel is largely advisory in that the legislature must approve the maps they construct. The Redistricting Commission members have until March 15th to draw a new map that meets the state Supreme Court’s objections to the federal map that they earlier disqualified.
Washington: The state legislature approved the Washington Redistricting Commission’s congressional lines, meaning the new 10-District map has been enacted as law. The Commission members made little change in the footprint that stood for the past ten years. All incumbents (7D-3R) receive a similar district to the one they currently represent with population adjustments. The most imbalanced seat vis-a-vis population was the 6th District of Rep. Derek Kilmer (D-Gig Harbor), which was short 33,730 individuals.
GOVERNOR
Alabama: Gov. Kay Ivey now has several official Republican opponents in her quest for re-nomination to a second full term. Alabama has now reported its official list of ballot qualified statewide candidates, and Gov. Ivey will face former US Ambassador to Slovenia Lindy Blanchard, real estate developer and son of former Gov. Fob James, Tim James, former Morgan County Commissioner Stacy George, non-profit organization founder Lew Burdette, and pastor Dean Odle.
Though the Governor is a heavy favorite to prevail, the crowded field makes it more difficult for her to clear the 50% hurdle to win the party nomination outright. Ms. Blanchard began the election cycle as a US Senate candidate, but switched to the Governor’s race. She is personally wealthy and intends to spend several million dollars of her own money to wage a viable campaign. The Alabama primary is May 24th. A runoff, if necessary, would occur on June 21st.
Georgia: Former DeKalb County Executive and ex-state Rep. Vernon Jones, who served as a Democrat but became a Republican to support former President Trump, announced that he is withdrawing from the contested gubernatorial contest. This sets up the one-on-one primary pairing, minor candidates notwithstanding, between Gov. Brian Kemp and former Sen. David Perdue.
Mr. Jones then entered the open crowded 10th District primary that Rep. Jody Hice (R-Greensboro) is vacating to run for Secretary of State, and with Mr. Trump’s endorsement. The former President was instrumental in talking Jones out of running for Governor.
Ohio: Public Policy Polling, surveying for the Democratic Governors Association (1/25-26; 628 OH likely Republican primary voters), is the third data research organization (Fabrizio Lee; The Harris Poll being the other two) to recently project a brewing Republican primary battle for Gov. Mike DeWine. The PPP result finds the Governor with a 36:43% personal approval rating and a 40:41% positive to negative job approval score among the Republican voting sample. The respondents would prefer Mr. DeWine in only a 38-33% spread opposite former US Rep. Jim Renacci in the GOP primary pairing.
STATES
New York: In an interview with the Bloomberg News organization, former Gov. Andrew Cuomo (D), who left office last year in response to multiple sexual harassment accusations and now says he regrets quitting because of them, refused to rule out again running for office, and maybe soon.
According to CNN and the New York Daily News, Mr. Cuomo is seriously testing the waters for challenging the law enforcement official who officially initiated the charges against him, Attorney General Tish James (D). Mr. Cuomo served as the state’s Attorney General from the beginning of 2007 until the end of 2010, prior to his first election as Governor.
Pennsylvania: The Pennsylvania state Supreme Court issued a stay on the statewide candidate filing deadline (March 8) and the primary (May 17), as the panel attempts to sort out the congressional redistricting situation. The move suggests that both the filing deadline and the state primary stand a good chance of being postponed. A spokesman for the PA Clerk of Courts, however, said the May 17th election date will likely stand.